Markup Calculator
Calculate selling price based on cost and markup percentage
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Calculation Results
Markup Calculator – Price Your Products with Confidence
This Markup Calculator is a simple yet powerful tool designed to help business owners, retailers, and sales professionals determine the correct selling price, cost, or markup percentage. Whether you’re pricing new products or evaluating profitability, this markup calculator removes manual guesswork and speeds up your decision-making.
What Is Markup?
Markup is the percentage added to the cost price of a product to determine its selling price. It reflects the profit you earn on each unit sold.
Markup Formula:
Markup (%) = (Profit ÷ Cost) × 100
If you know both the revenue (selling price) and cost, you can also use:
Markup (%) = [(Revenue − Cost) ÷ Cost] × 100
Example:
If you buy a product for $80 and sell it for $100, your profit is $20.
Markup = (20 ÷ 80) × 100 = 25%
Markup vs. Margin – Know the Difference
Many confuse markup with profit margin, but they are not the same.
- Markup is based on cost:
Markup = Profit ÷ Cost - Margin is based on revenue:
Margin = Profit ÷ Revenue
Example:
If you purchase an item for $80 and sell it for $100:
- Profit = $20
- Markup = 25%
- Margin = 20%
How to Calculate Markup – Step-by-Step
- Find your cost of goods sold (COGS). Example: $40
- Determine your desired revenue. Example: $50
- Calculate profit: $50 − $40 = $10
- Apply the formula: $10 ÷ $40 = 0.25 → 25% markup
Alternatively, use the formula:
Markup = 100 × (Revenue − Cost) ÷ Cost
Markup Formula to Find Selling Price
If you know the cost and markup percentage, you can find the selling price with:
Revenue = Cost + (Cost × Markup ÷ 100)
Example:
Cost = $50, Markup = 40%
Revenue = $50 + ($50 × 0.4) = $70
Markup in Price Management
Cost-plus pricing is a common strategy where a fixed markup is added to unit cost.
Formula:
Selling Price = (1 + Markup) × Unit Cost
This method is simple, widely used, and often based on industry standards. However, it does not consider customer behavior or market demand.
Key factors to consider:
- Lower-priced items often have higher markup percentages.
- Fast-moving inventory may have lower markups.
- Competitive markets require flexible pricing.
- Marginal cost should be considered in dynamic pricing strategies.
Typical Markup by Industry
| Industry | Typical Markup |
| Grocery Retail | 15% |
| Restaurants (food) | 60% |
| Restaurants (drinks) | Up to 500% |
| Jewelry | 50% |
| Clothing | 150%–250% |
| Automotive | 5%–10% |
| Sports Cars | Up to 30% |
High markups don’t always mean high profits, as some industries (like restaurants) have high overhead costs.
Unusually High Markups
- Movie theater popcorn: up to 1,275%
- Prescription drugs: 200% to 5,000%
- Bottled water: up to 4,000%
- Restaurant wine/champagne: 200% +
- Textbooks, greeting cards, bakery goods: very high
Other Considerations
This calculator has remained popular with professionals who regularly deal with pricing decisions. It’s quick, accurate, and helps avoid costly pricing mistakes.
FAQs
What is my profit for a 40% markup if my cost is $50?
Profit = 40 × 50 ÷ 100 = $20
What does a 100% markup mean?
It means you double the cost price. If something costs $50, you’d sell it for $100.
Read more guideline here:
- Investopedia – Markup Definition
- Harvard Business Review – How Companies Should Price Products
- U.S. Small Business Administration – Pricing Strategy